Dr Pepper Snapple Case

1412 Words Mar 22nd, 2013 6 Pages
Case Summary In early September 2007, Andrew Barker emerged from a lengthy discussion on the energy beverage market in the United States. As a brand manager for Snapple beverages at the Dr Pepper Snapple Group, Inc., he was charged with assessing whether or not a profitable market opportunity existed for a new energy beverage brand to be produced, marketed, and distributed by the company in 2008. Dr Pepper Snapple Group, Inc. was the only major domestic nonalcoholic beverage company in the United States without a significant branded energy drink of its own. The decision to explore a new energy beverage was made by senior company management as part of a corporate business strategy to focus on opportunities in high-growth and high-margin …show more content…
In the end, the pricing is the key factor to being successful. I will need to come up with a competitive price that will be able to compete but also have high enough margins to where we can make it. 3. Analysis: The analysis section will require me to evaluate each of the strategic options that we might have. I am going to layout the pros and cons for: heavy users, all energy drink users and the adult segment, as shown below in the appendices as figure 1-1. Single-serve energy beverage drink retail prices have generally settled at roughly $2.00 per single-serve package, regardless of size. As a consequence, larger single-serve packages are priced lower on a per-ounce basis than smaller packages. Shown in figure 1-2, it shows that our drink Rush NRG will need to come down a little bit in prices to be competitive and make margins meet. The 16-ounce size, representing about 50 percent of case sales in convenience stores, has posted the fastest growth. Multi-packs represent a small portion of case sales and typically are marketed through supermarkets and mass merchandisers. When coming to choose what version you want to make, it is obvious that regular energy beverages have an 80 percent share of the market; sugar free has 20 percent. Deciding what type of distribution to use between off-premise and on-premise to me is a no brainer. Convenience stores accounted for 74 percent of off-premise retail dollar sales. They also have a very high gross
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